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The Entwining of Trade Policy with Environmental and Labour Standards

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  • Anderson, Kym

Abstract

While environmental and labour issues are not new to the GATT, nor to other trade policy fora, they are likely to have a more prominent role in trade policy discussions in the years ahead for the newly formed World Trade Organization (WTO). Many developing countries perceive the entwining of these social issues with trade policy as a threat to both their sovereignty and their economies, while significant groups in advanced economies consider it unfair, ecologically unsound, even immoral, to trade with countries adopting much lower standards than their own. This paper examines why these issues are becoming more prominent, whether the WTO is an appropriate forum to discuss them, and how they affect developing and other economies. It concludes that: (a) the direct effect on developing economies is likely to be small and for some may even be positive through improved terms of trade and/or compensatory transfer payments; but (b) there is an important indirect negative effect on them and other economies, namely the potential erosion of the rules-based multilateral trading system that would result from an over-use of trade measures to pursue environmental or labour market objectives.

Suggested Citation

  • Anderson, Kym, 1995. "The Entwining of Trade Policy with Environmental and Labour Standards," CEPR Discussion Papers 1158, C.E.P.R. Discussion Papers.
  • Handle: RePEc:cpr:ceprdp:1158
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    Citations

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    Cited by:

    1. Anderson, Kym, 1995. "Agricultural Competitiveness After the Uruguay Round," Review of Marketing and Agricultural Economics, Australian Agricultural and Resource Economics Society, vol. 63(03), December.
    2. Kym Anderson, 1997. "Social Policy Dimensions of Economic Integration: Environmental and Labor Standards," NBER Chapters,in: Regionalism versus Multilateral Trade Arrangements, NBER-EASE Volume 6, pages 57-90 National Bureau of Economic Research, Inc.
    3. Markku Simula, 1999. "Trade and Environmental Issues in Forest Production," IDB Publications (Working Papers) 25678, Inter-American Development Bank.
    4. Spinanger, Dean, 1997. "The WTO after the Singapore ministerial: Much to do about what?," Kiel Discussion Papers 304, Kiel Institute for the World Economy (IfW).
    5. Markku Simula, 1999. "Trade and Environmental Issues in Forest Production," IDB Publications (Working Papers) 2995, Inter-American Development Bank.
    6. Gabriel Rodriguez & Yiagadeesen Samy, 2003. "Analysing the effects of labour standards on US export performance. A time series approach with structural change," Applied Economics, Taylor & Francis Journals, vol. 35(9), pages 1043-1051.
    7. Markku Simula, 2001. "Comercio y medio ambiente en la producción forestal," IDB Publications (Working Papers) 2989, Inter-American Development Bank.
    8. Ngo Van Long & Antoine Soubeyran, 1998. "Pollution, Pigouvian Taxes, and Asymmetric International Oligopoly," CIRANO Working Papers 98s-30, CIRANO.
    9. Maskus, Keith E. & Rutherford, Thomas J. & Selby, Steven, 1995. "Implications of changes in labor standards: A computational analysis for Mexico," The North American Journal of Economics and Finance, Elsevier, vol. 6(2), pages 171-188.
    10. Markku Simula, 2001. "Comercio y medio ambiente en la producción forestal," IDB Publications (Working Papers) 31298, Inter-American Development Bank.

    More about this item

    Keywords

    Environmental Standards; GATT; Labour Standards; Trade Policy;

    JEL classification:

    • F1 - International Economics - - Trade
    • J3 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs
    • K33 - Law and Economics - - Other Substantive Areas of Law - - - International Law
    • O19 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - International Linkages to Development; Role of International Organizations
    • Q2 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Renewable Resources and Conservation
    • Q3 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Nonrenewable Resources and Conservation

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